Khaleej Times

Apple’s appetite for India market leaves a bad taste

- Saritha Rai — Bloomberg

bengaluru — Apple’s latest attempt to crack the Indian smartphone market — by selling used phones — is meeting a wall of resistance.

The iPhone maker is seeking permission to become the first company allowed to import and sell used phones into the country, its second attempt in as many years. This time, the stakes are higher and a growing number of industry ex- ecutives are fighting the move, warning government officials in private that it’ll open the floodgates to electronic waste, jeopardise local players and make a farce of Prime Minister Narendra Modi’s Make in India programme to encourage local manufactur­ing.

“Make in India could turn into Dump in India,” said Sudhir Hasija, chairman of Karbonn Mobiles, who said it sells about 1.7 million phones a month.

Apple’s applicatio­n in 2015 was rejected by the environmen­t ministry without much fanfare. But things have changed since: India, as the world’s second largest mobile population, now represents a vast untapped opportunit­y for Apple just as China and the US are slowing. Apple has publicly talked up its prospects in India and is on course to get the green light to open its first retail stores.

Sensing the threat, the electronic­s manufactur­ing industry’s main representa­tive body recently set up a lobbying arm that wrote directly to the government vehemently opposing Apple’s applicatio­n.

“Why even consider allowing import of used phones when import of other used goods such as cars are precluded by 300 per cent duty levies?” asked Ravinder Zutshi, chairman of the newly formed Mobile and Communicat­ions Council, which issued the letter. The group’s members include the largest Indian phone brands: Micromax, Intex and Samsung.

A pivotal market

Apple’s applicatio­n has gone to so-called inter-ministeria­l discussion, said Asha Nangia, a director in the Department of Electronic­s & Informatio­n Technology. That adds a layer of bureaucrac­y to a process that’s far from certain. The government could go either way, though it’s encounteri­ng far greater local opposition than the first time around.

The maker of the world’s most expensive smartphone­s had been stymied by low incomes and regulation­s. But selling cheaper refurbishe­d devices can help convert price-sensitive consumers, who previously would have had to fork over a month’s earnings or more to own the coveted brand. Apple last month unveiled a smaller iPhone SE that, with a starting price of $399, may still be out of reach of many Indian buyers.

Apple now has less than two per cent of an Indian market in which four-fifths of phones cost less than $150. Branded smartphone­s are available for as little as $35 in India. Western multinatio­nals from car-makers to soda vendors use ‘India only’ prices and cut-rate ‘India edition’ products to woo customers. Apple can’t employ those strategies without tarnishing its marquee phone’s premium aura.

 ?? — Bloomberg ?? Apple’s smaller iPhone SE, with a starting price of $399, may still be out of reach of many Indian buyers.
— Bloomberg Apple’s smaller iPhone SE, with a starting price of $399, may still be out of reach of many Indian buyers.

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